Competition for retail shelf space is extremely aggressive.
The focus of discussion at a conference held recently by the Canadian Council of Grocery Distributors was major trends affecting the food retail industry in Canada. Environmental concerns, food safety, consolidation in the industry, changing demographics in Canada and an increasing interest in health and wellness by consumers were cited as some of the most important developments in this industry.
Since the early 1990s there has been a continuing trend towards consolidation in the food retail environment in Canada. This trend is expected to continue as food retailers aim to increase economies of scale and gain greater access to new markets through acquisitions. Saskatchewan’s food processors will be faced with fewer and larger distributors and retailers that have centralized their buying process.
Food retailers are being presented with 20,000 to 30,000 new products each year. While competition for retail shelf space is stiff, there are still a number of opportunity areas for suppliers. Food retailers are always looking for ways to differentiate themselves from their competitors by offering unique products that meet consumer demand.
Retailers are taking into account consumers' concerns over environmental issues and will be looking to meet the demands of consumers who have concerns over packaging waste and the use of chemical substances in food and packaging. Also, there is a growing interest in the idea of buying local - a trend which could bode well for many of Saskatchewan's food processors.
One of the most significant trends that will affect the demand for food in Canada is the changing demographics. By 2026 it is expected that 21% of Canadians will be over the age of sixty-five. Canada’s aging population and slow population growth will limit growth in the volume of food consumption. It is expected that population growth will mainly come through immigration which presents an opportunity to meet unique needs.
Canadian retailers have identified products that meet the needs of Canada's growing ethnic population and foods that integrate health and wellness with convenience as key growth areas, and retailers will likely look more and more to suppliers of these product types.
Success in the food industry will be based on the ability to provide unique products that meet consumer needs.
Source: Saskatchewan Agriculture
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